Warning on pensions as 1 in 3 babies will hit 100

Reforming pensions is essential to support Britainâs rapidly ageing population, a finance expert has warned.

1 in 3 babies will live to 100 (Picture: Alamy)

The âcrisisâ will worsen further unless the retirement age and rates for savings increase, said Annie Shaw.She made the comments as figures suggested more than one-third of babies born this year will live to 100.

The report by the Office for National Statistics also revealed that Britain has 14,500 people who have reached their century compared with fewer than 600 in 1961.

âReforms in place are having to be cranked up otherwise weâre going to find ourselves in a situation where the money runs out,â Mrs Shaw told Metro.

âItâs great that weâre all living longer but it does mean there will be problems over how to fund our retirement.

âThe government may have to make contributing to a pension compulsory if the automatic enrolment scheme rolled out in the autumn is not successful.

âItâs not a matter of saying someone else will provide because they wonât.â

The state pension age for men and woman is to rise to 66 by 2020 and increase by another year by 2028.

Chancellor George Osborne said in last weekâs budget he wanted toÂ increase the age further. Pensions minister Steve Webb said government plans would âset millions on course for a more prosperous retirementâ.